The workforce is getting older and organisations face a huge leak of valuable knowledge. How can HR help to stem the tide, asks Stephanie Sparrow?
Japanese factory worker Katsuya Hyodo has become a symbol of his time. The 72- year-old maker of automotive cylinders hit a nerve with businesses worldwide when he was profiled in the newspaper USA Today. Hyodo has spent his spare time transcribing 30 years’ worth of manufacturing knowledge onto a home computer to create a dossier, which he hopes to hand over to his successors.
Hyodo’s story shows that, as workforce demographics change, retaining knowledge has become one of the key issues in talent management.
On one hand, younger people now tend to follow ‘portfolio careers’, where they take between seven and nine jobs within their lifetime. On the other, some sectors face a demographic timebomb, as huge portions of their workforce approach retirement age. Both trends mean that a flow of valuable knowledge is escaping from organisations.
“We need to look at how we communicate and how we capture experience, and think more flexibly about working practices and how a job can be adapted to older workers,” says Peter Cheese, managing partner of human performance at Accenture.
The forthcoming age discrimination legislation will also open the doors for people to stay in employment longer, but this does not mean they will stay in the same career.
“As people realise that they will spend a greater proportion of their life span at work, they are also thinking that they might want to try out other careers,” says Isabel McGarvie, partner in HR services at professional services firm PricewaterhouseCoopers. Many workers in their mid-40s and 50s are returning to study, she adds.
Employers are also struggling to hold on to valuable older workers thanks to the closure of many final salary pension schemes. At the same time, increasingly nervous younger people who are still in work are protecting their market value by keeping knowledge to themselves. “The focus is on being lean and mean, but not on assessing the effects of their current skills profile on business performance,” says McGarvie.
But this could prove costly. A recent survey by consulting firm Accenture found that 60% of employers felt that gaps in skills or experience in their senior team were driving them to recruit externally to replace that knowledge.
Cheese advocates better deployment of people through work shadowing, mentoring and coaching and better use of technology, rather than expensive hiring policies.
Accenture offers clients an internet-based suite of tools that guides a team through a knowledge capture and transfer. It records experienced employees, known as ‘instructors’, as they execute key tasks (closing a client’s financial books, for example), and these recorded sessions are then stored in a knowledge repository, which employees can access through an internet portal.
Managers can check the extent to which instructors have completed their activities and how much knowledge has been assimilated by the learners.
But is simply storing and distributing knowledge enough?
Christine van Winklen, director of the knowledge management forum at Henley Management College, advises organisations to review all the methods of creating and dispersing learning that they have at their disposal.
“This should include learning agendas, knowledge management, corporate universities and learning,” she says.
Van Winklen urges organisations to create ‘communities of practice’, where groups of people come together to share and learn from one another face to face and virtually.
By doing this, says van Winklen, organisations can create emotional buy-in for retaining knowledge, since it is shared within a community, based on relationships with others, rather than direct transactions.
Expensive IT systems will not solve the problem, says Akber Pandor, director of learning and development at KPMG. Formally recording someone’s knowledge can stifle it and take it out of context, he says. “The best way to encourage young people and pass on the knowledge of older workers is to create a coaching culture,” he says.
KPMG takes on 850 graduates a year, who benefit from on-the-job coaching as they work on their first client projects.
“When the job is finished, it is reviewed by a senior person. This ensures there is an element of coaching. Then the graduate who is reviewed acts as a reviewer for the following year’s intake,” says Pandor. In addition, KPMG’s line managers are expected to act as coaches to their staff and senior people receive coaching and debriefing. Constant reviews keep knowledge alive and relevant – it is used, rather than stored.
Keeping knowledge alive is key. While not every organisation has a workforce with the tenacity of Katsuya Hyodo to write everything down, those that do not keep some record of corporate know-how could be faced with draining resources in years to come. M
How to… Retain knowledge
Peter Hall, knowledge management consultant and former chief knowledge officer of telecommunications company Orange, offers his advice on finding and keeping knowledge:
Look harder at who is being made aware of redundancy options. Instead of tempting the more experienced people (who stand to gain more from financial packages) to leave, consider offering them a work option that appeals to them.
Make opportunities for conversations to happen by creating shared tasks. The aim should be that tacit knowledge, which is in people’s heads, becomes explicit (in other words, shared) knowledge.
Map an employee life-cycle that joins up knowledge management and HR processes right from induction, through developing expertise, through to retirement.
Encourage line managers to create collaborative, not competitive environments.
Take a company-wide perspective when dealing with promotions or recruitment. Have fewer conversations behind closed doors.
Case study: Defence procurement agency
The Defence Procurement Agency (DPA) is anticipating the ramifications of demographic changes by accelerating its knowledge management projects.
For the past 15 years, knowledge management has been branded internally at the DPA as Learning from Experience, and a dedicated department runs websites and databases on how different aspects of the organisation work.
“In the past 18 months, we have been working even harder at being a learning organisation, and are joining up with HR to look at where the skills are and how they could be lost as the workforce gets older,” says Lucy Miller, Learning from Experience manager at the DPA.
“HR interviews people to extract tacit knowledge regarding the intricacies of different posts,” she says. “It will also conduct exit interviews when relevant. Feeding this information to us means that the organisation will then be in a position to back fill rather than watch the knowledge haemorrhage.”
Miller sees a broader role for knowledge management in succession planning. “This is not just about people retiring,” she says. “It’s about understanding that a line manager needs to
have a process that feeds back the information that they had. It’s about getting people to ask questions about things they deal with on a daily basis.”
The situation at the DPA goes against that of much of the private sector. As the private sector struggles with ‘portfolio career’ types who may only stay with their employer for a couple of years, the DPA has low attrition rates.
“People tend to be faithful to the Civil Service,” says Miller. “It’s a career organisation.” But while the private sector tends to bring back retirees on a consultancy basis, this is less common in the Civil Service. “This means we need to plug the gaps before they happen,” she concludes.